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Currency Outlook

Rupee Outlook

• Rupee ended on a weaker note yesterday amid dollar demand from importers. Further, rupee slipped on rising crude oil prices to their highest levels since October following escalating geopolitical tension in Middle East and Eastern Europe

• Rupee is likely to appreciate today buoyed by softness in dollar and decline in US treasury yields. Yields slipped after data showed moderation in labor market conditions, boosting market expectations that the Federal Reserve will start cutting interest rates in June. Additionally, investors will remain cautious ahead of US Non-Farm Payrolls data to get fresh cues on rate trajectory. Meanwhile, RBI in its monetary policy is expected to keep interest rate unchanged for 7 th consecutive time, more focus will be on statement to get cues on policy path. USDINR April likely to slip towards 10-Day EMA around 83.35 levels as long as it sustains below 83.60 level.

Euro and Pound Outlook

• Euro rose marginally by 0.01% yesterday amid soft dollar and an upward revision in the Eurozone S&P Composite PMI to a 10-month high. For today, EURUSD is likely to rise back towards 1.0870 level as long as it holds the support near 1.0800 level amid weakness in dollar and expectation of improved economic data from euro zone. EURINR April may further rise towards 90.90 level as long as it trades above 10-day EMA around 90.30 levels.

• Pound is expected to slip further towards 200-day EMA around 1.2560 level as long as its stays below 50-day EMA of 1.2670 level. Pound may show weakness on expectation disappointing economic data from Britian and pessimistic global market sentiments. GBPINR April is likely to move south towards 105.0 level as long as it stays below 105.60 levels.

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